Nairobi, Kenya, December 3, 2015—IFC,
a member of the World Bank Group, today announced new financing to seven
small hydropower plants that will generate power for tea factories affiliated
with the Kenya Tea Development Agency. The $55 million loan is arranged
by IFC in partnership with the Global Agriculture and Food Security Program,
PROPARCO, and The Netherlands Development Finance Company FMO.

KTDA operates 65 tea processing factories
across Kenya, sourcing its tea leaves from 350,000 farmers, who are shareholders
in the company, and co-own the factories. Energy accounts for over 30 percent
of costs for the tea factories. The small hydropower plants developed by
KTDA Power will supply 16MW of renewable, affordable power to the tea factories
that will help reduce costs and increase savings for the farmers. The construction
of the power plants is expected to create more than 2,000 jobs.

KTDA CEO Lerionka Tiampati said “Construction
of three hydropower projects in Gura, Chania and North Mathioya are at
advanced stages, funded by an earlier credit line from AFD (French Agency
for Development). With the funding that we have received today, construction
works for Nyambunde, Kiringa, Kipsonoi and Nyamasege SHPs will commence
in 2016.”

Oumar Seydi, IFC Director for Eastern and
Southern Africa said, “Access to power is one of the key constraints for
agriculture in Africa. KTDA is innovating to address power shortages by
developing its own captive and renewable power supply. Reducing costs of
processing will help make Kenya’s tea sector more competitive in a global
marketplace and increase revenues for the 560,000 farmers who supply green
leaf to the 66 KTDA-managed tea factories.”

Suzanne Gaboury, Director of Agribusiness
at FMO said, “FMO is proud to play a part in financing this project that
will enable the construction of seven small hydropower plants. After providing
long-term finance to KTDA’s micr-finance company, Greenland Fedha, in
2014, FMO will now be involved in a project that can generate reliable
and clean energy for KTDA’s tea processing factories. It should demonstrate
the business case for small-scale renewable energy projects in the region.”

Amaury Mulliez, Chief Investment Officer
of Proparco said “We are very pleased to partner with KTDA, a key player
in the tea industry with a unique model based on half a million local farmers.
It will further promote sustainability in the Kenyan agricultural sector.
By providing reliable and clean energy to tea factories, this project will
also reduce the carbon footprint of the country by an approximate 63,000a
tons of CO2-equivalent per year.”

On average, individual tea factories spend
approximately Ksh30 million ($290,000) to Ksh65 million annually on electricity,
depending on factory size, crop level and the variable costs such as fuel
cost adjustment and forex that are used by Kenya Power in the calculation
of electricity bills.

About IFCIFC, a member of the World Bank Group, is
the largest global development institution focused on the private sector
in emerging markets. Working with more than 2,000 businesses worldwide,
we use our capital, expertise, and influence, to create opportunity where
it’s needed most. In FY15, our long-term investments in developing countries
rose to nearly $18 billion, helping the private sector play an essential
role in the global effort to end extreme poverty and boost shared prosperity.
For more information, visit www.ifc.org.

About GAFSPGAFSP is a global effort that pools donor
resources to fund programs focused on increasing agricultural productivity
as a way to reduce poverty and increase food and nutrition security. GAFSP
targets countries with the highest rates of poverty and hunger. The public
sector window helps governments with national agriculture and food security
plans. The private sector window, managed by IFC, and supported by the
governments of Australia, Canada, Japan, the Netherlands, the United Kingdom
and the United States, provides long- and short-term loans, credit guarantees,
and equity to private sector companies to improve productivity growth,
deepen farmer’s links to markets, and increase capacity and technical
skills. For more information, visit http://www.gafspfund.org.

About ProparcoProparco is a subsidiary of the Agence Française
de Développement (AFD) devoted to private sector funding, and has been
supporting sustainable development for almost 40 years. It operates in
73 countries in Africa, Asia, Latin America and the Middle East and helps
finance and support financial institutions and corporate private-sector
projects. Today it has almost 400 clients worldwide. Proparco focuses on
key development areas, such as renewable energy-based infrastructure, agribusiness,
financial sector, health and education. Through its work, Proparco has
a powerful impact on sustainable economic growth, job creation, access
to essential goods and services and, more broadly, on poverty reduction
and fighting climate change. With a balance sheet total of €4.6bn at December
31, 2014 Proparco is one of the leading European Development Finance Institutions
which together spearhead a large number of joint programs. www.proparco.fr

About FMOFMO is the Dutch development bank. FMO has
invested in the private sector in developing countries and emerging markets
for more than 45 years. Its mission is to empower entrepreneurs to build
a better world. It invests in sectors where it believes its contribution
can have the highest long-term impact: financial institutions, energy and
agribusiness. Alongside partners, it invests in the infrastructure, manufacturing
and services sectors. With an investment portfolio of EUR 8.8 billion spanning
over 85 countries, FMO is one of the larger bilateral private sector development
banks globally. www.fmo.nl

About KTDA

The Kenya Tea Development Agency Limited
(KTDA) was incorporated on 15th June 2000 as a private company under (CAP
486) of the laws of Kenya, becoming one of the largest private tea management
agencies. The Agency currently manages 66 factories in the small-scale
tea sub-sector in Kenya. The agency is mandated with promoting and fostering
the growth and development of tea growing among the indigenous tea farmers.
Its mandate is to oversee and enhance the end-to-end processes from the
cultivation of tea, to the marketing of the same to local and international
markets.